"Today’s fall in overall unemployment is welcome but beneath the headlines the worries are multiplying," he said.

"There is now fresh evidence that Britain is becoming divided – long-term unemployment rose yet again, so did long-term youth unemployment and unemployment in two-thirds of England is higher than it was at time of the general election."

However total pay rose by 1.8% compared to the same period last year. This means that although more people are working, wages are not keeping up with inflation so living standards are not improving for most.

Liberal Democrat MP and party spokesman on work and pensions Greg Mulholland said the news showed that coalition policy was paying off.

"This is another encouraging sign. Together with the recent GDP figures, these are signs that the economy is healing," he said.

"The UK suffered a huge economic shock during the financial crisis. Liberal Democrats were clear when we joined the coalition government that it would be a choppy road to recovery but that we needed to create the right conditions to support growth and deal with the deficit."